What's Changed About Saving For Retirement?

We wanted to hear what younger people are thinking about when it comes to retirement and the viability of Social Security. Here's reaction from 20- and 30-somethings in Nashville, Tennessee.

ROD KELLY: I don't expect it to be there and I'm not planning on it to be there. I'm doing what I can right now to put into, like, IRA, you know, or Roth funds to make sure that I don't have to depend on it.

MORICO IRVING: It looks bleak. I'm expecting probably to be working through retirement. Not what I want to do, but that's what I'm expecting right now with the way the economy is going.

JONATHAN JONES: Whatever little money I can get to just put off to the side and save for the future, I put to the side. I may put, like, about 100, 150 the most every two weeks, depending on how my paycheck look.

LINDSAY WESSON: I'm really fortunate that I have a job that I absolutely adore and love coming to every single day. However, we do want to be in a position where we can retire when we need to.

CARL BLACK: I'm working two jobs to be able to provide. So, yeah, I'm saving enough to be financially stable. I'm expecting to retire successfully where I can just lay back and just doing have to do nothing else for the rest of my life.

MARTIN: That was Rod Kelly, a piano technician, Morico Irving, an unemployed college graduate, Jonathan Jones, who works for UPS, children's librarian Lindsay Wesson and sheet metal worker Carl Black. We recently spoke with financial planner Benjamin Birken to get some practical advice for these folks. We asked him what he tells younger workers who come into his office at Woodward Financial Advisers in Chapel Hill, North Carolina.

BENJAMIN BIRKEN: We try to tell them to focus on the things that they can control. They can't control really what happens to Social Security but they can control things like how much are they currently spending right now? What options do they have if they're at a workplace that has a retirement plan like a 401k or a 403b? What options might they have in investing in themselves, in investing their careers that might boost their lifetime earnings?

MARTIN: So, you're saying look for options for professional development?

BIRKEN: Potentially, sure. You know, things that might have a good risk in return calculation.

MARTIN: What about people who are in their 20s, folks who may have a lot of student loans to repay, they're looking for jobs in a really tough market, maybe they have a lot of credit card debt?

BIRKEN: Again, you got to focus on the thing that you can control right now. Certainly, with credit cards, we want to pay those down as quickly as we can, particularly if the interest rates on those credit cards are high, like in the teens. If you think about paying down that credit card as an investment, your return is equal to the interest rate that the card is charging you. And chances are you can't find an investment that's going to give you a return in the 12 to 14, 15 percent like you can if you pay down a credit card.

MARTIN: How does the retirement picture differ for people in their 20s and 30s compared to their parents? I mean, will retirement itself look different for this younger generation? Should they expect to work longer?

BIRKEN: Absolutely. Retirement for folks in their 20s and 30s is going to look different than their parents', just like their parents' retirement is going to look different from their grandparents'. Their grandparents could mostly reliably count on Social Security and a government or employer pension and then maybe a little bit of savings to form a three-legged stool, is just how financial planners like to talk about it. Their parents' generation saw the disappearance of pensions from that retirement picture. And for people in their 20s and 30s pensions don't even exist. So, what's happening is people have to be more and more reliably counting on themselves to fund that retirement. But that's also mixed with they're going to live a lot longer than their grandparents. And retirement looks different. These days, retirement's a lot more of an active phase of life. People are taking on second careers, people are taking on more and more volunteer opportunities. And so retirement by itself is just going to look different. And accordingly, it's going to have to be funded differently.

MARTIN: And it sounds like from what you're saying that saving for retirement itself requires more active participation, that individuals actually have to get more involved in making proactive decisions.

BIRKEN: That's exactly right. People are a lot more and have to be a lot more responsible about their savings and where money is going to come from once they stop working.

MARTIN: Benjamin Birken is a certified financial planner in Chapel Hill, North Carolina. Mr. Birken, thanks for talking with us.

BIRKEN: Thank you very much. This was fun.

(SOUNDBITE OF MUSIC)

MARTIN: Coming up, my conversation with singer Michael Buble. It is a good one. And I may be on Twitter talking about it. So, if you're a Michael Buble fan, join us for a Twitter chat right after the puzzle. You can find me @RachelNPR.

(SOUNDBITE OF SONG, "YOUNG AT HEART")

MICHAEL BUBLE: (Singing) Fairytales can come true, it can happen to you when you're...